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Electric car drivers could face new pay-per-mile tax under Treasury plans: Report

The 3p per mile tax aims to recover lost fuel duty revenue and could cost average electric vehicle drivers £250 annually, starting in 2028 after consultation.

  • Car owners could face a new 'pay-per-mile' tax of around 3p for every mile they drive, as proposed in plans reportedly being considered by Chancellor Rachel Reeves.
  • The proposed tax, expected to be unveiled in the November 26 Budget, is aimed at addressing the growing loss of fuel duty revenue caused by the rapid shift to electric vehicles .
  • While initially applying only to EVs that have lost their vehicle excise duty exemption in 2025, motoring bodies fear the per-mile system could eventually be expanded to all vehicles.
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The Telegraph broke the news in London, United Kingdom on Wednesday, November 5, 2025.
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